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New book by MBA alumna tackles the breakdown of capitalism

Published

Denise Hearn dives into world-scale economic problems in new book, The Myth of Capitalism.

After piquing her interest in global social issues while completing her MBA at Oxford Saïd, Denise Hearn wanted to understand why modern American capitalism was failing the majority. Workers struggle with stagnant wages while inequality grows, productivity and investment are at decade lows, and yet corporate profits have never been higher. She wanted to know: what was causing this divergence?  

I’ve always been interested in economic justice and social justice more broadly,’ says Hearn, but her time at Oxford magnified her interests. She ran the Social Impact Oxford Business Network and took part in the MBA Global Threats and Opportunities (GOTO) project while at the School. Her experience here ‘was incredibly positive in terms of how I thought about social change, and it really sharpened my understanding of how complex challenges should be approached.’ 

After the MBA, Hearn joined a macroeconomic investment strategy firm, Variant Perception, that advises the world’s top hedge funds and family office investors. In discussions with her colleague Jonathan Tepper, founder of the firm, they both concluded that something structural had changed in the economy. 

In the early stages of her employment with Variant Perception, she simultaneously attended a programme at The Banff Centre in Canada which aimed to address the systematic drivers of inequality. ‘It was really interesting to have those two experiences at the same time,’ says Hearn. With this seed of an idea, Hearn and Tepper began their detective work ‘to understand why we are in the state we are in today’. 

The Myth of Capitalism: Monopolies and the Death of Competition is the result of this work. From studying academic papers and other resources, the authors found that the economy has become increasingly concentrated in all major industries following a wave of mergers. Now nearly every aspect of daily life is influenced by large, dominant firms. The book synthesizes comprehensive academic research in an accessible way, using tangible examples people can relate to like: airlines, beer, and digital companies like Google and Facebook. The authors argue that capitalism without competition is not capitalism. 

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The idea of restoring competitive markets ‘is something that has been resonating with both conservative and progressive audiences, because they intuitively understand that if you believe in capitalism, you should want more competition,’ says Hearn. Whatever your politics, you are undoubtedly impacted by industry concentration. As Hearn puts it, ‘The average person now transfers a little bit of their paycheck to monopolists and oligopolists because these businesses control the tolls of daily life.’ 

Business schools have never been more important. Hearn argues that business schools need ‘to teach their students about the wider consequences of their corporate actions.’ In business schools the world over, students learn Porter’s Five Forces that teaches them to limit competition to their businesses as much as possible while guarding against the threat of incumbents. ‘They are taught to act completely in the interests of the company.’  

If taught in isolation, this perspective doesn’t capture the wide range of considerations business leaders should be thinking about. ‘The paradox is that what is good and right for their company individually is not good, right, or beneficial to the economy as a whole,’ Hearn argues. This is known as the ‘fallacy of composition’ – what is true in part, is not always true in whole. Business schools must have their students ‘consider the entire ecosystem they are working within – not just shareholders,’ and why Hearn hopes Saïd will continue its role in shaping leaders with a global vision of creating more equitable marketplaces through projects like GOTO.

Denise Hearn

Denise Hearn

Denise Hearn is co-author of The Myth of Capitalism: Monopolies and the Death of Competition. She has an MBA from the Oxford Saïd Business School (class of 2014) where she co-chaired the Social Impact Oxford Business Network, and a BA in International Studies from Baylor University.

Denise has always been interested in human flourishing. She has managed a variety of projects in this vein including: building new impact investment models in Canada, presenting to over 50,000 people while designing nationwide educational curriculum, and helping to create the world’s first Trustmark for Sharing Economy companies in the UK. She was chosen to participate in the Alt/Now: Economic Inequality residency program at the Banff Centre. She resides in Seattle with her husband.